NIFTY WEEKLY OUTLOOK & OPTION CALL PUT TIPS FOR 9 SEP TO 13 SEP 2019

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UNIONBANK 57.5 CALL NEAR TO HIT 1ST TGT  MADE A HIGH OF 2.2

WEEKLY RESISTANCE FOR NIFTY: 11100, 11200, 11300

 PIVOT POINT: 11000

WEEKLY SUPPORT FOR NIFTY:  10900, 10800, 10700

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 11000, 11050, 11100

PIVOT POINT:10900

DAILY SUPPORT FOR NIFTY :  10850, 10800, 10750

DAILY CHART FOR NIFTY

After an extended weekend, nifty started the week with a big gap down mainly on the back of escalated trade war between US and China over the weekend. Index then consolidated a bit throughout the first half but all of a sudden the selling momentum accelerated at the stroke of the penultimate hour which lasted till the closing point of the day. Eventually Nifty ended with a mammoth cut over 200 points on Tuesday. Tuesday’s sharp selloffs were followed by a muted opening on Wednesday; but immediately in the initial trade, the selling momentum resumed and we went on to sneak below the 10750 mark. Things started to look a bit intimidating but fortunately we saw good buying emerging at lower levels which continued for the remaining part of the day. This recovery was mainly provided by the easing political tensions in Hong Kong and hence we witnessed a rub off effect to conclude in the positive territory.  Thursday, we had a good head start for the day as index opened slightly higher on the back of positive global cues. However we couldn’t capitalize on this early morning lead. In the latter half, we not only wiped off all gains but also managed to slip slightly into a negative territory. Eventually the weekly expiry ended flat with no clear direction. Nifty managed to hold the 10,850 level and gradually extended its gains towards the 10,950 mark in Friday’s trade.

NIFTY: A STRONG SUPPORT WILL BE @ 10750; STRONG RESISTANCE LEVEL SEEN @11100

We still remain optimistic and expect the index to revisit 11200-11400 in coming days. For the coming week, 11000 followed by 11200 are the levels to watch out for in the upward direction and on the lower side, we expect 10750 to act as a sheet anchor. In case of any decline , traders should construe this as a good buying opportunity. It formed a bullish candle on the daily scale while Bullish Pin Bar on the weekly scale, which implied support-based buying interest has emerged in the market at lower levels. Nifty has started to form higher lows and supports are shifting higher. Now it has to hold above 10,850 to extend its bounce towards 11,050 and 11,100 levels, while on the downside supports are seen at 10855 and then 10775 levels.

TECHNICALLY SPEAKING.

The closing beyond 11000 was crucial not only because it’s a psychological junction; but also in terms of technical, because with this we concluded the August Month with some important clues left behind for us. Let’s see what we are exactly referring to. (i) Recent correction got arrested around the 61.8% retracement (10637) of the previous up move, (ii) we could see a formation of ‘Bullish Piercing’ pattern on daily chart on August 23, (iii) Friday’s recovery happened from key retracement ratios and formed a ‘Bullish Hammer’ and most importantly, (iv) Monthly candle concluded above ’20-EMA’, which remained defended on a closing basis since March 2016 and depicts a bullish ‘Dragonfly Doji’ pattern. We were hopeful since last couple of days but now looking at these multiple observations, it has certainly fuelled our conviction level. Yes, index is struggling to surpass the sturdy wall around 11000 – 11150, but we will not be surprised to see it crossing in the coming week to extend this rally towards 11200 – 11250. Hence, we advise traders to refrain from creating shorts and should now adopt a buy on decline strategy for a while. On the downside, 11800 followed by 11700 would now be seen as immediate supports.